MGM lets UA off on Cruise control

Indie's parent frowns on interim pact with WGA

United Artists on Monday announced an interim bargaining agreement with the WGA as speculation swirled over whether other indie film companies also might make deals with the guild.

Details of the pact weren't disclosed, just as with the interim contract the WGA reached last month with David Letterman's Worldwide Pants.

But in a joint release, the WGA and the MGM-owned UA said "the comprehensive agreement addresses the issues important to writers, including new media."

The WGA's industrywide negotiations with the Alliance of Motion Picture & Television Producers broke down in part over guild demands for greatly expanded compensation for new-media content, with the studios' organization offering only modest hikes.

UA's agreement with the WGA, announced on the 64th day of the guild's strike against Hollywood studios, had been anticipated (HR 1/7). It means guild scribes can go back to work on UA film projects, though Oliver Stone's "Pinkville," shelved in November over script problems, won't be taken out of turnaround.

The agreement does not extend to MGM, but it does represent the first such deal with a film company. An insider said MGM technically might have prevented the UA move but as a practical matter was bound by the spirit of its agreement with division heads Paula Wagner and Tom Cruise to let the indie go its own way.

The parent studio issued a statement Monday criticizing the move.

"MGM understands the desire of United Artists to resume its business activities but respectfully disagrees with its decision to sign an interim agreement with the WGA," the UA parent said. "MGM remains committed to working with AMPTP member companies to reach a fair and reasonable agreement with the WGA that positions everyone in our industry for success in a rapidly changing marketplace."

MGM chairman Harry Sloan was unavailable to elaborate on the statement.

"United Artists has lived up to its name," WGA West president Patric Verrone said. "UA and the writers guild came together and negotiated seriously. The end result is that we have a deal that will put people back to work."

Wagner, who serves as UA chief executive, called the interim agreement "important, unique and good business sense" for the indie.

"In keeping with the philosophy of its original founders, artists who sought to create a studio in which artists and their creative visions could flourish, we are pleased to have reached an agreement with the WGA," Wagner said.

UA postponed production on Stone's My Lai massacre project "Pinkville" in mid-November, saying it needed a script rewrite that couldn't be done because of the writers strike. But several other UA projects in various stages of development can now get back on track.

"This agreement is virtually identical to the agreement signed by David Letterman's Worldwide Pants," Verrone said in an e-mail to members. "It features all the proposals we were preparing to make when the conglomerates left the bargaining table a month ago. Those proposals include appropriate minimums and residuals for new media (whether streamed or downloaded, as well as original made-for content), along with basic cable and pay-TV increases, feature animation and reality TV coverage, union solidarity language and important enforcement, auditing and arbitration considerations.

"We expect this deal to encourage other companies, especially large employers, to seek and reach agreements with us," he added. "As those deals are announced, we will report them immediately to you."

Indeed, execs at such other indie film companies as the Weinstein Co. and Lionsgate are known to be mulling similar interim pacts with the guild. The WGA has come up with an interim bargaining-agreement template and has faxed the proposal to several indies, with the understanding terms could be tweaked where necessary to fit individual situations.

Weinstein Co. execs are interested in making a deal with the WGA, but they hope another indie will be the first to follow in UA's path. Development on important Weinstein film productions -- including such projects as "Nine," based on a Broadway musical about Federico Fellini's "8 1⁄2," and "The Seven Samurai," inspired by the Akira Kurosawa classic -- have been held up by the writers strike.

Over at Lionsgate, there's also clearly at least moderate interest in entering into an interim pact with the WGA. But it appears that Lionsgate execs will give the situation another few weeks before inking such a deal, eyeing the AMPTP-WGA divide in the meantime for any signs that the parties' negotiating impasse might somehow be resolved.

Weinstein Co. execs are known to be especially frustrated with the contentious nature of the studios' talks with the WGA. The talks were quarrelsome from their start in July, and on Dec. 7 the AMPTP said it would refuse to continue contract talks with the WGA until the guild removed certain demands from the bargaining table.

"One-off deals do nothing to bring the WGA closer to a permanent solution for working writers," the AMPTP said in response to news of the UA deal. "These interim agreements are sideshows mean only that some writers will be employed at the same time other writers will be picketing. In the end, until the people in charge at WGA decide to focus on the main event rather than these sideshows, the economic harm being caused by the strike will continue."